Social Capital and the Extreme Poor in Bangladesh

We investigate the effect of social capital on hygiene practices pertaining to lives of the extreme poor in rural Bangladesh. Analysing a unique survey dataset for 5,600 extreme poor households, we document a significant positive effect of social capital on sanitary latrine use and wearing shoes/sandals at home for hygiene. We account for the endogeneity of social capital by instrumental variable estimation. Our findings emphasise the role of social capital in preventing common diseases through improving hygiene practices for the extreme poor, who usually lack access to medical services in the event of illness, which has important policy implications.